quote:

And that wouldn't address the issue of those that pay no taxes at all, or get back more than they pay.

That’s what bothers me. Half the people in this country are living off of government in one way or another… living off of the work of others who try to be frugal.

quote:

Originally posted by Russ59:

I think part of the problem today is that many people in financial trouble aren’t willing to make the lifestyle changes necessary to turn things around (downsize, get a second job, move to a more affordable place, own economical cars). They believe they are owed the same level of comfort they enjoyed while working.

I believe those in their 20's and 30's have believed they should enjoy the same standard of living they enjoyed as children!

Each generation has had more wealth and a higher standard of living than the previous one. Today's young adults grew up in very luxurious times! Air conditioned homes and schools. Multiple automobiles in the family. Big screen tv with cable/satellite. Microwave ovens, pre-prepared meals. Good clothing easily and cheaply bought.

Abundance. They have assumed it is simply there.

They don't understand that wealth is derived from productivity. They don't understand finance.

Soft circumstances make for soft people. Soft people make for hard times. They're going to face tough times, and likely will not understand why.

quote:

Originally posted by wrightd:
It's not entirely their fault, since the private sector discontinued traditional retirement plans a very long time ago.

I came out of college in 1982, so I witnessed that transition.

One huge effect was that employers and workers lost a sense of loyalty to each other. With pensions, people would seek out a position or at least a company to hitch their future to. People were incentivized to be employed and stay.

In the late 1980's my boss was nearing 60 and had been there for at least 25 years. He said he would sweep floors in Alaska for the next 5 years if that's what it took for him to get his full pension. Younger employees were put into the 401k rather than the pension, and were all looking for the next job that paid more.

Pensions require some of the workers' productivity be withheld from their paycheck to fund payouts. So they aren't "free" to the worker. Some form of required or incentivized retirement savings could be an excellent alternative.

I sit back and laugh when I hear people talk about not having money, but they are drive brand new car and went on three vacations. Hopefully you put enough in your 401.

I've lived cheaply; drove old cars until recently; never went on vacation; never ate out; purchased in bulk; shopped around; delayed gratification; etc.

I'm now driving the car I want, going on my first long vacation, and planning on retiring earlier than most people. I've watched them having fun and enjoying luxuries in life while I saved. I have no pity that I will be comfortable in retirement while they are working.

My mother spent the bulk of her working life at the largest hotel in NYC, looking forward to the wonderful pension. The hotel went broke, and her pension disappeared before she was able to receive one penny of it.

She worked at minimum wage office jobs well past retirement age.

I also worked with an older gentlemen. Ken was a great guy. Worked 35 years for a competitor. Right before he was ready to retire the company pulled the plug. Poof, his hard earned retirement saving was gone. Of course the owners and families were set. Ken, not so much. He ended up working part time for us for a few years. That always really bothered. He was such a great guy. I knew what had happened. But he never said a word.

My late ex-father-in-law worked for a company known to fire older workers a couple of years prior to retirement. So he stated his age as several years younger than he really was. That was last century before computerized networked data made such a thing impossible.

This is one of the things that just astounded me working in family law. My folks were frugal and lived below their means, as do I. I never knew so many people living as if they are more or less well-to-do are just putting on a show. I’ve done lots of Inventory and Appraisements on divorces where folks had on towards $100,000 in credit card debts, new cars and big mortgages at 50 or older, designer clothes and bags. No savings to speak of. Negative net worth. I was also shocked at how many people see filing their tax returns as optional.

I stopped trying to give advise years ago. Nobody listened to me except for my middle son.
He's 29 single, lives in an apartment that hasn't jacked up his rent. He still drives the used Honda Accord
I bought for him when he turned 16. He puts money into the 401k at work and has about 150k in cash.
I can't believe how many people in their 50's and 60's that live paycheck to paycheck. But they always
have new cars. My son wants to buy a house, I said wait till Trump gets elected and see if prices go down.
I doubt they will.

quote:

Originally posted by Powers77:
not witholding taxes from paychecks is EXACTLY what needs to happen

That, and changing Election Day to the first Tuesday after April 15.

I will chime in that life needs balance. You can’t go Willy nilly spending without consequence of course. And saving for planned retirement started for me with my first job after graduating college 30 + years ago. I don’t have a lavish lifestyle, but don’t deny my wife or I a couple vacations a year either. When I am eligible for military retirement in about a year and a half, that will help ( mix of active duty and reserve component service) not a ton of money, but every bit helps.
I do scrutinize my “luxury” purchases ( guns for example - I have all the guns I need for assigned duties, and compared to my 30’s when I was in the “ gun of the month club” I buy perhaps 2-3 a year)
Between military retirement 401k and SS, can get by just fine.
However I have also sadly witnessed a lot of people from my generation ( a great number of which I served with in the GWOT) that died in the 40’s and 50’s, or are so decrepit at 65 they can’t enjoy retirement. Spending some money to enjoy life while you still have reasonable health and vigor is not crazy either, just don’t go broke doing it.

Another perspective- my brother knew a younger single guy who was a police officer who took on a bunch of those foreign DOJ contracts for training cops in some pretty sketchy countries. He would do a contract basically banking the pay, return to his cop job long enough to retain his position then go do another foreign contract and so on, until he had a couple million saved up. Figured he’d get his 20 in the police service and retire at about 42. Gets within a month of retirement and gets in a fatal accident.

Saving is important but so is living while you can. Younger generations just can’t seem to balance the 2 very well.

quote:

Originally posted by captain127:

Saving is important but so is living while you can. Younger generations just can’t seem to balance the 2 very well.

That's a tough balance to figure out. There is a terrific book called "Die With Zero" by Bill Perkins which provides a decent thought process.

The first half is a bit repetitive but then he gets to the meat. Essentially his model is that our goal is to extract maximum fulfillment from life (whatever it means to each person). We have 2 resources, our health and our money. Health declines with age, whereas money increases. The key is to maximize the use of each when it makes the most sense. Spend some money and save some money when younger. Do physically hard things when younger, reserve the easier things for later.

Anyhow, I highly recommend the book.

quote:

Originally posted by V-Tail:
My mother spent the bulk of her working life at the largest hotel in NYC, looking forward to the wonderful pension. The hotel went broke, and her pension disappeared before she was able to receive one penny of it.

She worked at minimum wage office jobs well past retirement age.

You did help her didn't you? When my father in law died I ended up supporting my
Mother in law till I got divorced. Don't know who's helping her now, I know it can't be my exwife.
She totally screwed herself, massive debt.

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Family/friends careless with money

Helping those who are financially irresponsible and refuse to help themselves? Done it once. Never again.

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Originally posted by Fly-Sig:
There is a terrific book called "Die With Zero" by Bill Perkins which provides a decent thought process.

I finally got around to reading this book last year. I thought he made a great case for enjoying life and the experiences it offers before you get too old to do so.

quote:

Originally posted by 12131:

quote:

Family/friends careless with money

Helping those who are financially irresponsible and refuse to help themselves? Done it once. Never again.

Same here. Let the guy live with me, helped him get a job and a car. Once he moved out on his own, he was flat broke in less than a year and living on friends’ couches again.

quote:

Originally posted by old rugged cross:
Worked 35 years for a competitor. Right before he was ready to retire the company pulled the plug. Poof, his hard earned retirement saving was gone. Of course the owners and families were set. Ken, not so much. . I knew what had happened. But he never said a word.

This is the kind of general anecdote that really doesn't make sense other than for drama.

Either he was in a pension plan which they would have been obligated to fund to at least a minimal level, or he had assets in a 401(k) retirement plan. Either way, if those just "poofed" the owners would be in deep trouble.

Now if had a substantial investment in the company stock, that's a different matter. And idiotic.

^^^^ I had friended a couple in their late 50's, they both worked for Circuit City for years, when CC went tits up they lost their retirement. I guess it was CC stock?

quote:

Originally posted by BigSwede:
^^^^ I had friended a couple in their late 50's, they both worked for Circuit City for years, when CC went tits up they lost their retirement. I guess it was CC stock?

I worked for a freight company that had an impressive stock plan which a number of the older pilots considered their retirement plan. When the company folded they all lost everything including their jobs!

The owner had a complicated arrangement where he sold shares (for cash) to some bank which was paid by the company. In essence the employees funded it in exchange for lower paychecks. So he walked away with millions.

quote:

posted by chellim1:
Half the people in this country are living off of government in one way or another… living off of the work of others who try to be frugal.

I'm sure you mean handouts, not those who paid into the system for 20-50 years.